Life Insurance/ annuities 2-14
A life policy loan in Florida cannot charge a fixed rate of interest higher than...
10%
What percentage of eligible persons must a policy cover in a noncontributory group?
100%
The minimum age at which a person can sign a life insurance application is...
15 years
A person is required to be AT LEAST how old before he or she is licensed as an agent in most states?
18
An insurance company can contest a life insurance contract due to application fraud within...
2 years
In Florida, most life insurance policies have a contestability period of...
2 years
Insurance agents must notify the Commissioner(or Director) of a change of home address within a MAXIMUM of how many days?
30
The conversion period for a terminated employee to convert group life coverage to an individual plan is...
31 days
According to Florida's rules on disclosure, a life insurance applicant is expected to be provided with...
A Buyer's Guide and Policy Summary
The insurer must provide a prospective buyer with...
A Buyer's Guide and Policy Summary
An example of an unfair trade practice is...
A agent making a material misrepresenation to the insured
A variable life insurance agent must be licensed and appointed as a life and variable contract agent, as well as...
A broker dealer
An individual covered under a Group Life insurance policy is considered to be...
A certificate holder
If an insurance company is organized under the laws of New Jersey and licensed to do business here, it is considered which of the following in Texas?
A foreign company
An insurance company that is incorporated in New Hampshire and does business in Florida is defined in Florida as...
A foreign insurer
Deceptive advertising is considered to be...
A form of misrepresentation
Which of the following individuals MUST be licensed as an agent?
A person who places insurance on behalf of anyone seeking insurance.
State insurance laws specifically allow the Commissioner(or Director) to issue a temporary license to which of the following individuals?
A surviving spouse of a deceased agent
All of the following will result in the suspension of an agent's license EXCEPT....
Acting with fiduciary responsibility
Which of the following employers tasks does a Professional Employer Organization normally handle?
Administration tasks
Insurance companies that are organized in countries outside the United States are referred to as...
Alien
J owns a business and has a Group Life policy covering her employees. J decides to cancel the policy by letting it lapse on the renewal date. What action must be taken?
All of the employees must be notified of the cancellation either by the insurance company or through J
All of the following provisions are required in a group life policy EXCEPT...
An Accidental Death and Dismemberment provision
Which of the following situations does NOT apply to the Florida Replacement Rule?
An existing policyholder purchases an additional policy from the same insurer
An agent may legally share commissions only with...
Another agent who is licensed in the same line of insurance
The Life and Health Insurance Guaranty Association is funded by...
Assessment on member companies
All of the following constitue an unfair trade practice under State law EXCEPT...
Attemping to replace coverage written by another agent within one year of its issue date
Which of the following actions by an insurance company is an unfair claims practice?
Attempting to settle claims on the basis of an application that was altered without the consent of the insured
Which of the following acts is an agent NOT authorized to do on behalf of an insurer?
Authorize claim payments
The coordination of benefits (COB) provision exists in order to...
Avoid duplication of benefit payments
It is fair to discriminate in the amount of benefits for life and health policies...
Between individuals of different classes
Defamation is BEST described as publishing or circulating which of the following types of information?
Brochures falsely criticizing the financial condition of an insurance company
Which of the following can an agent provide to help a prospective client understand and purchase the most appropriate product?
Buyer's guide
An example of sliding would be...
Charging for an additional product without the applicant's consent
As a condition for a loan, a bank requires the borrower to purchase credit insurance from a specific company. What is the bank guilty of?
Coercion
J is an agent who recently told a claimant that his rights might be impaired if he does not complete a release form within a specified time. What could this agent be found guilty of?
Coercion
Which of the following areas of state regulations is NOT protected by the savings clause in ERISA
Commerce
The following at our example of unfair methods of competition and deceptive practices in the business of insurance EXCEPT the use of...
Comparison showing that a policy has higher benefits
The Commissioner(or Director) of insurance has the power to...
Conduct examinations of insurance companies
The 14-day free look period for life insurance polices begins at the...
Date of delivery
Circulation of any oral or written statement or any pamphlet, circular, article, or literature that is false or maliciously critical of or derogatory to the financial condition of an insurer is known as
Defamation
Which of the following unfair trade practices involves an agent who makes malicious statements about another person's financial condition
Defamation
Which of the following actions by an insurance company is considered an unfair claims settlement practice?
Denying an insured's claim without indicating the basis of denial under the policy.
Which two entities regulate variable annuities?
Department of Financial Services; and Securities Exchange Commission
Before approving an application for a business entity acting as an agent, the Commissioner(or Director) must find that the business entity has...
Designate an agent to be responsible for compliance with insurance laws
The insurance Commissioner(or Director) may examine the records of an insurance company on order to...
Determine the solvency of the company
An insurance company incorporated under the laws of the state in which its home office is located is called a(n)_____ company
Domestic
The Commissioner(or Director) of insurance is empowered to...
Enforce state laws relating to insurance
The purpose of the Guaranty Fund is to...
Ensure that claims filed against insolvent insurance companies will be paid
Individual life insurance proceeds are exempt from creditor's claims when they are payable to any of the following entities EXCEPT the insured's...
Estate
An insurance company may be judged guilty of false advertising if...
Exaggerates its dividends in a newspaper advertisement
The life insurance and annuity replacement regulation defines replacement as...
Exchanging an existing policy for a new policy
All of the following provisions must be included in life insurance policies EXCEPT...
Extended term
Which of the following is an unfair claims practice?
Failing to effectuate prompt, fair, and equitable settlements of claims
An insurance company that promises lower insurance rates than any othr company in the country may be charged with...
False advertising
The act of an insurance company publishing misleading information about its policy's provisions is called
False advertising
T is an agent and when hired, is reminded that he has a responsibility to handle clients' funds in an honest and ethical manner. This responsibility is referred to as...
Fiduciary responsibility
Which of the following is NOT a consequence for placing business with an unauthorized insurer?
First degree misdemeanor
Nonprofit life insurance providers that are covered by a special section in the Florida insurance code are called...
Fraternal life insurance organizations
M completes an application for health insurance but does not pay the initial premium. All of these actions must occur before M's policy goes into effect EXCEPT
Free-look period has expired
Which of the following employees may NOT be excluded from a group life plan?
Full-time employees after the probationary period
An insurance company may NOT reject a prospective insured's insurance application on the basis of which of the following factors.
Gender
Which of the following is a standard provision of the conversion privileges in a Group Life Policy?
Group Life coverage can be converted to an individual policy at regular rates on an attained-age basis
Which policy is EXEMPT from replacement regulations?
Group life
What would be an accurate definition of "controlled business"?
Insurance business that is written on the agent's own life, property or interests
Which of the following situations are NOT subject to Florida life insurance law?
Insurance companies' day-to-day operations
Which of the following BEST describes Credit Life insurance?
Insurance issued on a debtor to cover outstanding balances on installment loans
An insurance broker is a representative of...
Insured
The Commissioner(or Director) of insurance may suspend, revoke, or refuse to renew the license of an agent who...
Is found guilty of misrepresentation or fraud on obtaining the license.
Which of the following statements is CORRECT about the replacement of one insurance policy with another?
It is strictly regulated and requires full disclosure by both the producer and the replacing insurance company
Who is a mutual insurance company owned by?
Its policyholders
A stock insurance company is owned by...
Its stockholders
An insurance company may compensate all of the following people EXCEPT...
Licensed agent not appointed by the company
The fund that assures policyholders payment of benefits of Life and Health Policies, if the company is insolvent at the time of the claim, is called the...
Life and Health Insurance Guaranty Association
The rules and regulations of the Life and Health Insurance Guaranty Association apply to...
Life and Health Policies issued by companies authorized in that particular state
If an agent would like to sell Variable annuities, which state examination must the agent pass?
Life and Variable contracts
What is the main reason for regulating the insurance industry?
Maintain the solvency of insurance companies.
According to Florida law, which of the following information does not need to be obtained by an agent recommending an annuity purchase?
Marital status
An agent who tells a client that diviended are guaranteed may be guilty of...
Misrepresentation
Convincing a prospective insured to buy an insurance policy based on exaggerations is called...
Misrepresentation
During the course of an insurance transaction, if an agent makes a false or incomplete statement, he or she could be found guilty of...
Misrepresentation
Which Unfair Trade Practice involves an agent suggesting that an insurance policy is like a share of stock?
Misrepresentation
Which Unfair Trade Practice involves making a false statement on an insurance application in order to receive money from an insurer?
Misrepresentation
A stock life insurance company that issues both participating and nonparticipating policies is doing business on
Mixed plan
What are adjustable rates for life policy loans in Florida based on?
Moody's corporate bond index
Which type of insurance company allows their policyowners to elect a governing body?
Mutual
Which of the following is NOT an unfair claim settlement practice?
Needing written documentation of claim details
When an existing life insurance policy is being reissued with a reduction in cash value, the agent must sign the...
Notice Regarding Replacement of Life Insurance or Annuity
An example of rebating would be...
Offering a client something of value not stated in the contract in exchange for their business
An example of unfair discrimination would be...
Offering different terms of coverage for different policyowners having the same risk classification
Under Florida law, a variable annuity policyowner must be notified of the accumulated value of the contract
Once each year
Replacement regulation apply to which of the following types of contracts?
Ordinary life
K is an agent who made an improper sale of an annuity to a client. Which of the following corrective actions would the Department of Financial Services likely order K to take?
Pay monetary restitution to the client
If, at the time of an insured's death, the insurance company discovers that the insured's age was misstated on the application for life insurance, the company will most likely
Pay the policy proceeds in the amount the premiums would have purchased at the insured's actual age
Which of the following types of insureds are life insurance companies allowed to make policy rate discriminations against?
People that smoke
A certificate of authority does which of the following?
Permits an insurance company to transact business in that state
Q applied for life insurance and submitted the initial premium on January 1. The policy was issued February 1, but it was not delivered by the agent until February 7. Q is dissatisfied and returns the policy February 13. How will the insurer handle this situation?
Policy was returned within the free-look period, premium will be fully refunded
No insurer shall refuse to insure an individual because of
Race
All of these considered sources of underwriting information about an applicant EXCEPT?
Ratings services
According to Florida law, group life insurance conversion privileges must NOT...
Require evidence of insurability
Which of the following is an example of rebating?
Returning a portion of a premium as inducement to purchase insurance
Group life policies MUST include all of the following provisions EXCEPT...
Right to Loan Proceeds
Which of these is NOT a legal entity for selling life insurance in Florida?
Risk management advisers
All of the following are defined as doing insurance business EXCEPT...
Selling mutual funds
Which of the following is NOT considered rebating?
Sharing commission with an agent licensed in the same line of business
Which action by an insurance agent is considered rebating?
Splitting commissions with a policyholder who has purchased additional coverage
The Replacement of Life Insurance and Annuities regulation is designed to protect the interest of...
The Policyowner
If an insured sustains a loss on a policy sold by an agent through an insurance company that is not authorized to do business in that particular state, which of the following would be liable?
The agent and the company
Which of the following statements regarding a nonresident insurance agent is CORRECT?
The agent must hold a similar license in their state of residence
Which of the following parties must provide an insured with proper disclosure concerning the replacement of an insurance company?
The agent who sells the new insurance policy
According to state insurance law, while transacting insurance business, agents act as representative of...
The insurer
According to Florida's life insurance replacement laws, a policyowner must be provided with a written Comparison and Summary statement when is requested by...
The policyowner
In order for domestic, foreign, or alien insurance company to conduct business, it must be authorized by whom?
The state where they are conducting business
T is an employee covered under a Group Life policy. If T's employment is terminated, the conversion privilege gives T the right to convert
To an individual policy upon employment termination
One of the stated purposes of the Life and Health Insurance Guaranty Association is...
To assist in the prevention of insurer insolvencies
An example of an unfair claims settlement practice is...
Turning down a claim without providing the basis of denial
An agent who makes misleading statements that lead to the termination of an existing insurance policy so that a new policy with another insurer can be taken out has committed
Twisting
Inducing or attempting to induce any insured person through misrepresentation to lapse, forfeit, or surrender insurance is...
Twisting
Which of the following is considered an accurate statement of unfair trade practice?
Twisting involves an agent using misrepresentation to convince a policy owner to cancel their current policy so that they can purchase a new life insurance policy with another company
A foreign insurance company is one that is incorporated...
Under the laws of another state
Which of the following activities will NOT result in the suspension of an agent's license.
Working for an foreign insurer.
An agent's license can be suspended or revoked by...
Writing primarily controlled business
Replacement is involved in all of the following situations EXCEPT when...
a Term policy is converted to a permanent plan with the same insurance company